Suppose two economists are arguing about policies that deal with unemployment One economist says the government should fight unemployment because it is the greatest social evil The other economist response Nonsense Inflation is the greatest social evil These economists ?

A. really don’t disagree at all It just appears that they disagree.
B. disagree because they have different values.
C. none of these answers.
D. disagree because they have different scientific judgments.

Economic growth is depicted by ?

A. a shift in the production possibilities frontier outward.
B. a movement from inside the curve toward the curve.
C. a shift in the production possibilities frontier inward
D. a movement along a production possibilities frontier toward capital goods.

Which of the following statements is normative ?

A. Large government deficits cause an economy to grow more slowly
B. People work harder if the wage is higher
C. The unemployment rate should be lower
D. Printing too much money causes inflation

Which of the following is most likely to produce scientific evidence about a theory ?

A. A lawyer employed by Renault addressing the impact of air bags on passenger safety.
B. An economist permanently employed at a leading university analyzing the impact of bank regulations on lending to small businesses
C. An economist employed by the Trades union congress doing research on the impact of trade policy on workers’ wages
D. A radio talk show host collecting data from listeners on how capital markets respond to taxation

In which of the following cases is the assumption most reasonable ?

A. To address the impact to taxes on income distribution an economist assumes that everyone earns the same income.
B. To address the impact of money growth on inflation, an economist assumes that money is strictly coins.
C. To model the benefits of trade. an economist assumes that there are two people and two goods
D. To estimate the speed at which a beach ball falls, a physicist assumes that if falls in a vacuum.

Economic models are ?

A. Usually made of wood and plastic
B. built with assumptions.
C. useless if they are simple.
D. created to duplicate reality.

Positive statements are ?

A. Macroeconomic
B. Microeconomics
C. statements of description that can be tested
D. Statements of prescription that involve value judgments.

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